BISD Audit – Molly Mulbriar Weighs In

Molly Mulebriar, private investagator, weighs in on the BISD audit story:

I have both the MedReview LLC audit done in 2007 and the CTI audit done this year. I dont agree with either one to the extent that I dont believe their methodology is bullet proof. Both based their findings off “discounts” and neither one had the ability to review provider specific contracts for compative purposes, nor did either firm have the ability to compare each hospital’s charge master. In my opinion, to compare PPO savings one has to have both the chargemasters and the actual contracts.
Then there are variables such as changing charge masters. Every 60 days hospitals review their chargemasters and make changes as they deem necessary. So those numbers are a moving target. Also, hospitals use formulas applied to their charge masters that are payer specific. Hospitals will deny this, but they are lying. I purchsed a book that was written just for hospital administrators and there is a section within the book that describes how a hospital can actually use different billed charges off the same charge master, for different payers. So, when hospitals say that it would be illegal for them to charge one payer more than another, that may be true. But what they are doing is using the same exact charge master, i.e. same prices for all payers, but applying a formula to each payer which effectively changes the billed charges by payer. I can document all of this and would be prepared to do so at a School Board Meeting, deposition, etc.
So, when one audit says the average overall aggregate PPO savings for Texas True Choice is 41% (as the MedReview audit shows) and another audit says the average overall aggregate PPO savings for HealthSmart is about the same (as the CTI audit shows), one has to ask (1). Was the chargemaster pricing taken into account over both time frames (2). Were 100% of claims repriced for the audit (3). Were contract outliers taken into account (4). Were each provider contract specific to each taken into account (5). Were provider re-pricing fees taken into account (6). Did the audit take into account escalater clauses inherent in all PPO contracts (7). Was a Favored Nations clause in any of the PPO contracts with any of the hospitals.
This is just a short answer to my basic thesis: You cant adequately compare PPO savings using the methodology employed by either auding firm, in my opinion.
So the question is “How does TTC and HS compare in savings to the BISD?” If you didnt know better, and only relied on both the MedReview and CTI audits, you would conclude that the TTC and HS “discounts” are just about the same. In the aggregate, both are within 1% of each other.
Then, of course, I point to the claim repricing exercise I had X do on the XXXXXXXXX claims at XXXXXXXXX. last year. We sent them a year’s worth of claims to reprice under their contract. The difference between TTC and HS was about 1%.
So the case could be made that both networks are about the same. And, I suspect that if a proper audit could be done using the methodolgy I prefer, the outcome would be about the same too, but better documented. I say this because providers these days dont have to give one payer a much better deal than another. Dr. Sorenson, a well known expert in this field, came to the same conclusion in his studies (I have his report in my files).
Politically speaking, TTC beats HS all day long. The public perception now is against HS and for many perception is reality. Such is the power of a lawsuit, irregardless of it’s merits.
Hope this makes sense.  BTW – ran into Don Pedro yesterday and he agrees with me on this.